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Bulls and Bears

News/Business. The latest market news; the week ahead on Wall Street. (CC)

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00:31:00

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Gary B. 9, Us 7, Obama 5, Brenda 3, Jonas 3, John 2, Phem 1, Dad 1, Amazon 1, Usthe 1, Drones 1, Burgers 1, Lord 1, Neil 1, Irs 1, Nike 1, Urconsumers 1, Oregon 1, Bernard 1, Tony Romo 1,
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  FOX Business    Bulls and Bears    News/Business. The latest market  
   news; the week ahead on Wall Street. (CC)  

    December 8, 2013
    1:00 - 1:31am EST  

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markets? that is about all we need. that is our show. see you next week.of the melting arctic ice caps. >> thanks for joining us. raise the wage! raise the wage! raise the wage! >> super sizing the wage war. fast food workers in hundreds o cities walking off the job this week. it's all part of union-backed protests, demanding 15 bucks an hour. and president obama agreeing it's time for a raise in the minimum wage. >> i'm going to keep pushing until we get a higher minimum wage for hard-working americans across the entire country. it will be good for our economy. >> but, as the unemployment rate is heading in the right direction, will this wage hike have jobs taking a hike? hi, everyone, this is "bulls and bears." let's get right to it. the bulls and bears. gary b. smith.
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tracy burns. john nas max ferris. along with bernard whitman. ll pushing the minimum to the max push out jobs just as they're coming back? >> yes, absolutely, this is the wrong thing to do in an economy that's showing some signeds of recovery. remember, they're targeting the wrong people. this is a great union and democratic slogan to say, look at the ceo, how much he's making. you can't raise the minimum wage to $15 an hour? take mcdonald's nor example. they will tell you, they don't set the wages for the local franchises. these are your moms and pops. these are your neighbors out there. they can't afford -- they don't have huge margins to raise the wages to $15 an hour. remember, if you want to help poverty this isn't the way to do it. the earned income tax credit does it. take this out of politics. take this out of unions. remember, 67% of people that make minimum wage work part time. $53,000 a year is what the
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average person who makes a minimum wage, that household, makes. this does not do lot for poverty but it does hurt small business. >> does it hurt the young people, the college students who are flipping burgers? they don't want to make a career of it but they're part time and raising the wage would probably get them out of a job. >> actually, i totally disagree with that. there's very little evidence to suggest that. a modest increase in the minimum wage, tying it to inflation, actually has a net job loss. >> they're asking for double. >> i don't think that's appropriate. i support the president's call to raise the mimum wage. as he said in february, tie that to inflation, tie that to cost of living. that makes sense. how can anybody earn a living on $15,000 a year? doesn't make sense. i don't support a whole sale increase of it to 15. i think that would be too much. tying the minimum wage to inflation so we don't have to go through this every three, four years, and give people an opportunity to actually live on the minimum wage.
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that's what we got to do and tie it to the cost of living and the inflation rate would be the first step to do that. >> what does history show us about raises in minimum wage and unemployment? >> exactly, brenda, from 2007 and 2009, the minimum wage was raised 41%. and you look at -- you talk about the college age and the people in mcdonald's, what happened to that group? well, 16-year-olds to 19-year-olds, the unemployment rate went from 16% to 26%. so, it's those exact people -- by the way, they're not the people that are the household leaders, as bernard alludes to. those are just college and high school kids as you point out, you know, looking to earn a few bucks. the best thing these people can do in order to raise the wage that the mcdonald's franchise owners are paying is to simply not take the job. if they don't take the job and other people do take the job, it
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says there is a market to work for the minimum wage. if no one -- if everyone stood back and said, no, those are unacceptable, than the franchise owners would have to raise the wage in order to stay in business or simply go out of business. this works against the workers in the long term. it's really just a horrible idea. let the free market work. >> and, jonas, does it hurt consumers as well as workers? >> i would think it's going to hurt consumer also more than workers. the economy's picking up. you can actually handle these cots to some extent without leading to layoffs. at this point, it would do -- let's say oil prices when they went from $40 a barrel to $150 before the recession. prices go up ultimately. walmart doesn't make enough profits to give everybody a $6 raise across the hour. there's not enough profits there. they're going to pass on the cost. so ultimately this is all going
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to be paid for by the consumer. the margin won't even change that much at a walmart. you're going to see mcdonald's get rid of the dollar menu is what's going to happen. is that a better scenario? it might be. that urconsumers have to pay mo and buy less. but that's what the result is going to be. >> tracy. >> if you go through the payroll cost increases, howo you offset it, if you're not selling more burgerings. i don't ca that the economy's turning around, people are still struggling. if you don't bring in more revenue, you offset the payroll cost. people who own the place are going to hire less or layoff. people who already have jobs are going to get less hours. that's the bottom line. they're screwing themselves by asking for more money. >> bernard, what do you think? >> look, i think, like i said before, to from $7.25 to $15 is too much. you're talking about not just a handful of college students, you're talking about 4 million people that deserve more than 7 bucks and 25 cents an hour.
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>> gary b., if we say take it up according to inflation, if we say take it up according to 15 bucks an hour, why not just say take it to 15 bucks an hour to get rid of poverty? >> exactly. right, bernard says $15 is too much. what about $14? maybe that's too much. what about -- you know, the powers that be somehow know the magic number, that's right. you know, getting back to bernard's point, tied to inflation, i think these workers will still be protesting. because what has inflation according to the government has done this year? it's done nothing. what are they going to do? see another 15 cents an hour in their paycheck? it would amount to nothing. what if inflation was negative? do they take less money? >> one of the things we talk about a lot is minimum wage is a starting point. it's not supposed to be the american dream. like, i'm making 7 bucks an hour, i can die now. it's a goal, it's a beginning,
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it's a start. we have to push and want for more. so do all these people. you don't want to live on this for the rest your life, you want to get better. >> it's not that you want to make a career in flipping burgers at mcdonald's. that's a beginning. you're a college student. that's where you want to start. >> yeah, absolutely. that's where most people start. it is an entry level position. the one thing i agree with bernard on is you should index this to something. probably another basket of wages. so you take this out of political hands. we've got another debt crisis coming up. another potential shutdown. they're arguing over a $15 minimum wage. this is smoke and mirrors to get awayfrom the real problem that there are almost 50 million americans right now in poverty. more than any time in the history of our country. what this country needs is jobs. any type of job. you need to get away from this, take this away from the union hands and politic hands. by linking this to something, probably a basket wages.
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>> why not just link it to the market? why not just let the market decide? >> i actually -- i agree with john. linking it to inflation and maybe even a broader index of wages makes perfect sense. it depoliticizes it. it is not a union issue, not a political issue, it is a hands to mouth issue. i think gary b. said, well, inflation was so low this year. if you compound that for the last 4 1/2 years, it would stand to reason that $7 would be closer to the $8, $9 range. i think indexing it to inflation once we adjust and bring the minimum wage up to $9, $10 an hour, makes a lot of sense. >> you hit the nail on the head, why can't the market work in these cases? the market seems to work across all year areas except where the government demand price control, and minimum wage where it doesn't work. >> okay, thanks, guy if you thought doubling the minimum wage was bad, how about doubling the federal gas tax? >> a lot people listen to this, okay, this congressman is talking about -- you're talking
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about doubling the gas tax and acting like it's no big deal. >> neil and the gang with more on that at the bottom of the hour. up here first, the young winner of the administration obama care video saying price doesn't matter. tell that to the young and restless saying they won't sign up. why that could mean the price tag for the rest of us is about to go way up. war ii
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and changed history. i'm jamie colby. more headlines 30 minutes away. ♪ don't need a lot of money money money ♪ ♪ we just want to make it ♪ with affordable health care >> catchy, huh? that's the winner of the administration's obama care video contest. forget about the price tag. well, try telling that to a majority of young folks who think they're going to be socked with a hefty price tag because of the law. maybe that's why only 22% of uninsured mill len yells plan to sign up for it. gary b., you say that all means we're facing a bigger price tag. >> brenda, absolutely, look the whole foundation of obama care is to get the young healthy people to pay higher premiums. in fact, subsidize the program for the older ones who really need the obama care. i mean, really need the medical attention.
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so, for example, you're going to see an average 21-year-old see their premium increase about 81%. in fact, almost aoss the board, even with the subsidies that the government's throwing out, they're going to see catastrophic increases in what they're going to pay. so what are they going to do? they're going to say, look, i'm not going to pay that money. i'm healthy. i'm 21 years old. i'll pay the fine. which, by the way, i don't see how the irs is going to collect anyway, they have no mechanism to collect that. let's just say they can collect it. that's going to be a mere pittance as opposed to what they should be paying in. what's going to happen? obama care's like, we don't have enough funds. where are they going to get the funds? from the rest of us with increased obama care taxes. it's so inevitable. we'll be having this conversation a year from now. >> bernard, all these young people don't like obama care. if they don't sign up, what does happen to prices for the rest of us? >> gary b. has been the chicken little on obama care from the
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very beginning. the fact is, now that kids are going to be able -- and young adults are going to be able to get on to the exchanges and find out ways available, what the coverage is like, i think we'll see enrollment numbers increase. ultimately, we're going to have to wait until march to figure out what the actual numbers are. here's what i encourage parents to do with their children around the christmas table this season is talk about health care, talk about the measures, talk about the benefits. the preventive care, the birth control -- >> bernard, stop, please, you're going to ruin everyone's christmas. >> i advocate putting enrollment stickers in everyone's stocking. >> they tried to get us to do that on the thanksgiving table. it is not open. i think they were trying to get bartenders talking about it as well. i'm not going to let gary b. go down as the only chicken little, i am right there with him. >> thank you, tracy. >> any time. the sky is falling. look, 22% enrolled. they need a number like 39%.
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here's how it's going to backfire even further. part of the new law allows kids 26 and under to go on their parents plan so you automatically pull those kids out of the pool that's going to help pay for the old people. our premiums are so going up. everyone should just plan on it. put cash under the tree to pay for your health bill. >> that pretty healthy girl singing had plastic furniture in the back. when she gets her $250 a month health care bill, she's going to go bananas. the bottom line, i got to say, they stuck the cost of 55-year-old insurance, which is expensive, because you're older, on 25-year-olds. those people aren't going to want to pay for it. it's going to wind up being taxed on somebody else later. unfortunately, we need them in it. $95, whatever the fine is, they need jail is what happens if you don't do it, because we need 100% of the people under 35 on
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this plan, subsidizing older people. >> okay. on your christmas table, do you think you'll be talking about this? is that going to convince your nieces and nephews to sign up? >> good lord, no. we talk about how tony romo blew another season for the cowboys most likely. gary b. is chicken little, bernard is a fountain of misinformation. let's break this down. amazon can handle 1 million transactions per minute. this government website can handle 50,000. that's how competent these guys are. these guys are ideologue whos w know nothing about people. they understand they've been sold a bill of goods here, they have been told they can keep their doctor, keep their health plan. they know it's not true. >> let's forget about the website. let's think about, instead, are we going to pay more? >> well, we have to, brenda, look, in bernars situation, he
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think, ys you can sit around li some norman rockwell christand just for the good of the country pay a heck of a lot more money. what kid? what 21-year-old? you know, dad, you're right, i think that would be the right thing to do. they'd laugh at you and walk out. by the way, they would take the christmas turkey with them. no, the cost has goto fall on everyone else because the ki aren't going to pay the money. >> okay, sorry, sorry, guys, we got to go. all right. is santa's delivery system about to get sled by a drone? why amazon's new plan for why amazon's new plan for door-to-door d
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is the delivery guy about to be replaced by this little guy? amazon unveiling a plan for future, delivery by drone. customers would get their package in 30 minutes or less. you think this would be a nightme? you're a tech guy, come on. >> i like technology but these drones belong in the defense department only. obama should be controlling phem. i tell you why, i can think of nothing scarier than my entire suburban town full of these black suburban birds dropping packages off to the consumers. it needso be stopped before it gets started. >> jonas has never been this xi excited about something. do you disagree? you like these drones? >> i love them. these drones are not going to be armed, okay, they're not going to shoot anybody. they're also laws against the
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horseless carriage at the turn of the 20th century. oh, my god, we can't have these contraptions going all over town, they're going to killll people and children. this is the wave of the future. i love this. i want to order pizza from it as soon as we get one. >> i like that. bernard, are you going to be calling domino's too? >> i think it's a good idea for rural areas. for cities and suburbs, complete disaster. it's a huge pr attack for jeff bezos. he went on "60 minutes" right before cyber monday dropping this bomb. cyber monday sales for amazon, all-time high. maybe using some of that money to jump start this program. >> gary b., what do you think? >> i'm surprisingly in bernard's camp. the good pr part. you know, usthe money to actually launch -- i'm with john n jonas. if i was a kid around a neighborhood with a sling shot, this is my first target as it is flying by. >> i don't know, i want a gallon
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of milk, i want an amazon book, it comes in 30 minutes, i like it. >> i wish this was more than a pr stunt. i have a pit in my stomach that i too am in berrd's camp. i think this was jeff bezos getting out there. who cares? he's thinking forward, he's being an entrepreneur. he's making some noise. i love it. >> okay, you go ahead, last word. >> when i'm older, lazy and my he aring's bad, sure, buzz the neighborhood. right now, if i have to listen to delivies on the weekends -- he's lucky the euunabomber is n still mailing packages around -- >> oh, come on. >> this is the tech future that they warned us about. >> you've got the hitchcockian movie and everything, "the birds," and -- >> that future we can have, ts is a hazard to society. >> weep got to end on that note.
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>> thanks, guys. and thank you, bernard, for joining us. we appreciate it. remember this? >> let's stop this. really juvenile political games. to one dealing with health care for senators and house members and our staff. we are going to be part of exchanges. that's what the law says and we'll be part of that. >> senate majority leader hairy reid just did something for some of his staffers which has someone here asking who's p
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the predictions, gary b. >> overnight is as quick as i want something. u.p.s. is here to stay. >> bull or bear, john? >> i like droen drones, bear. >> your prediction. >> it blew away earning, closed at 73 on friday, i think it goes up another 30% in the next six months >> bull or bear? >> bear. >> tracy. >> harry reid is allowing his congressional staff to avoid getting into obama care. give me a break. everyone is in, he saidt himself, stop the games. >> jonas. >> we're going to wear out our shoes faster, nike, 20% on the year. >> wow. >> what is up with you?
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>> gary b., bull or bear on this? >> drones at this point have a better chance. >> okay, we are going to deliver the best business blockext. neil takes it away. pump it, then tax it. i don't know about you, you've had enough of it. welcome, everybody. follow the money if you can even find the money. because it is not easy to get t of the democratic congressman when he's looking for money. not just a little more money. oregon's guy wants to double the taxes because he says our infrastructure needs the dough. i asked